This outlook took the shine off reassurances that Casino would still deliver a 20 percent rise in group operating profit for 2017 and its confidence of achieving 2018 earnings growth.

Casino, whose credit rating was cut to junk by Standard & Poor’s in March 2016, is under pressure to revive profits in France, its biggest market, where it now makes more than 50 percent of its sales, at a time of slower growth in Brazil, its second-biggest market by revenue.

The retailer, which reports full-year earnings on March 8, said 2017 group operating profit should amount to 1.24 billion euros ($1.5 billion), a year-on-year rise of around 20 percent.

Excluding property gains, which it forecast at 90 million euros, Casino expects core food retail trading profit in France to be higher than 460 million euros. While this would represent a year-on year rise of 9 percent, it is below a previous Casino forecast for a 15 percent rise.

“Casino seems to have missed its full year food retail guidance in France. Since forex has moved in the wrong direction in recent weeks, the consensus probably needs to adjust its 2018/19 earnings per share estimates,” analysts at brokerage Bryan Garnier said in a note.

Casino shares were down 5.9 percent at 1057 GMT, sharply underperforming the European retail sector and dragging down shares in its domestic rival Carrefour. Casino shares rose around 10 percent in 2017.

SIGNS OF WEAKNESS AT MONOPRIX

Stripping out acquisitions, disposals, currency effects and fuel, group sales rose 3.2 percent year-on-year, a slight deceleration from 3.4 percent growth in the third quarter.

In France, mild weather in October hurt clothing sales at Monoprix, where sales fell 0.5 percent on a same-store basis in the quarter after rising 3.1 percent in the third quarter.

The weather also hurt non-food sales at its Geant hypermarket, which fell 9.6 percent in the quarter.

The decline at Geant, however, also stems from the fact that Casino has reduced retail space for non-food items in response to competition from online and smaller convenience stores to focus on fresh and organic products. Geant food sales rose 2.8 percent in the quarter.

Casino, however, expects the macro-economic situation in Brazil to improve in 2018, and for deflation to ease off. ($1 = 0.8173 euros) (Reporting by Dominique Vidalon; Editing by Sudip Kar-Gupta and Alexander Smith)